Business & Technology

Conditions sour for organic dairy farms

Dairy producers’ alliance responds to Gary Hirshberg of Stonyfield Farm

This essay is the latest installment in a debate between Ed Maltby and Gary Hirshberg, CE-Yo of Stonyfield Farm. Maltby opened the debate with this post; Hirshberg responded here; Maltby's response follows below. We are airing the debate at length because we think our readers should know that our organic dairy farmers have reached a crisis point -- squeezed by production costs that are rising much faster than the price they receive in the market. ----- I want to thank Gary Hirshberg for replying so quickly to some of the points that we have been raising for the last six months. Gary and Nancy Hirshberg and the many employees of Stonyfield have been pioneers in the organic movement, along with folks like George Siemon of Organic Valley and Mark Retzloff of Aurora Organic Dairy. Gary has long been a leader of the organic community and has helped shape the way in which the industry has expanded. In answering some of Gary's points, I'd like to widen the discussion and move away from sound bites and platitudes that are the bane of our society, and share some of the difficulties of organic dairy that we all struggle with day after day.

Crude oil at $130 this year? And $150 next year?

Rising cost of oil pushes value of the dollar down

Bloomberg reports: Crude oil may reach a record $130 a barrel this year because pension funds are investing more in commodities, said Pierre Andurand, the chief investment officer of BlueGold Capital Management LLP, a hedge fund ... "Next year, oil may rise even further to $150 a barrel." Okay, this is a hedge fund guy who is betting the ranch on oil and probably doing his part to drive up prices. But at the end of the day, this is an issue of fundamentals -- supply and demand: Oil companies such as Exxon Mobil Corp., Royal Dutch Shell Plc and BP Plc are finding it tougher to replace their findings and are drilling for harder-to-reach deposits while energy demand and crude prices surge to records. Another little-discussed factor in the run-up of oil prices is the run-down of the dollar, and with it, U.S. living standards compared to the rest of the world. Thank you so much, President Bush!

Yet another perk of energy-efficient buildings

Car plant cuts energy costs $627,000 with two-month payback — with DOE help

Economic models greatly overestimate the cost of carbon mitigation, in large part because economists simply don't believe (and hence don't model) that the economy has lots of high-return energy efficiency opportunities. In their theory, the economy is always operating near efficiency. Reality is very different than economic models. I have never visited a factory or commercial buildings that didn't have huge energy-saving opportunities, many of which also increase productivity. I wrote a book several years ago with a hundred real-world case studies: Cool Companies: How the Best Businesses Boost Profits and Productivity by Cutting Greenhouse Gas Emissions. Studies that model such real-world savings, like the 2007 McKinsey & Co. report, find deep emissions reductions are possible at low net cost to the U.S. (and world) economy. Government has an important role in enabling these energy savings. The office of Energy Efficiency and Renewable Energy at the U.S. Department of Energy, which I used to run, has lots of (underfunded) programs that deliver savings every day. One typical example showed up in my inbox yesterday, from the Industrial Technologies Program:

Stonyfield Farm responds

Gary Hirshberg argues that his company is doing a lot to support organic dairy farmers

The following is a response to a post by Ed Maltby, executive director of the Northeast Organic Dairy Producers Alliance. ----- Gary Hirshberg Londonderry, N.H.: These are difficult times for the organic dairy industry, and as we have demonstrated consistently for over a decade, we are deeply engaged in the effort to find solutions that balance escalating supply costs with the need to keep organic product prices within the average consumer's reach. Stonyfield has consistently fought for farmers' interests, despite the pressures of the marketplace to reduce or hold prices for our yogurts. Over the past five years, the pay price we pay for organic milk has risen 34 percent, while Stonyfield has only raised the price of its 6-oz. yogurt 11 percent over the same period. We have endeavored to meet farmers' needs, while finding savings in other parts of our business. The fact is, despite our supplier costs rising dramatically over recent years, we have worked hard to maintain an affordable price for the consumer. This is a very tough balancing act, but at the end of the day, the greatest thing we can do is to grow the organic segment that benefits all the players -- farmers, processors, and consumers. And Stonyfield has done just that, by converting 100 percent of our products to organic, increasing our purchases of family-farmer-supplied organic milk to over $60 million per year, and all the while investing in numerous strategies that will help our family farmers to thrive.

An interview with eco-certification expert Michael Conroy

Michael Conroy. Photo: Chris Conroy Photography As a shopper, you can’t turn around without running into some type of green label, from Fair Trade to FSC-certified. But what do they all mean, and where the hell did they even come from? Economist Michael Conroy digs into the history behind these increasingly common labels in his book Branded!: How the ‘Certification Revolution’ Is Transforming Global Corporations. He brings to life the campaigns that led to the creation of the Forest Stewardship Council, along with its ongoing challenges from the industry-funded Sustainable Forestry Initiative; the struggles faced by the Marine Stewardship Council …

Bringing a knife to a gunfight

What drives climate change denial?

David and I have apparently crossed blog streams (very dangerous; never do this), but I do want to expand a bit on this basic idea: climate change skepticism has little to do with science. Rather, it is an outgrowth of the culture war. This point seems both totally obvious and strangely unremarked. At the risk of generalizing, environmentalists tend to view climate change denialism as a top-down, money-driven phenomenon. Energy producers, auto manufacturers, oil companies, and other interested parties court politicians, buy friendly scientists, and groom armies of lawyers, lobbyists, and op-ed writers to push their agenda. Or so the theory goes. And, of course, there's a lot of merit to that theory. You don't need a compass to follow the trail of money. But the theory only goes so far. A shrinking but significant proportion of average American citizens reject the reality of climate change. The reasons for this are surely overdetermined -- scientific confusion, media spin, hopelessness in the face of a big problem, etc. -- but it's impossible to ignore the basic cultural resentment underlying everything from Planet Gore to the regular flow of blog comments and email I get from dedicated dead-enders.

What's wrong with the WCI?

The Western Climate Initiative’s first proposal ducks biggest climate problem

The Western Climate Initiative is a path-breaking effort. Insufficient federal progress prompted seven states and two provinces to join together to reduce climate pollution by means of an economy-wide cap-and-trade program. It's a momentous opportunity, and many folks have been working hard to ensure that it's a success. Unfortunately, there's now cause for serious concern. Yesterday evening, WCI released its draft proposal (PDF). It proposes an initial cap that would cover less than half of the region's total emissions. Most surprisingly, WCI does not recommend including emissions from transportation fuels, by far the largest source of climate pollution in the West. [Update 3/7: The recommendation doesn't exclude transportation precisely, but rather defers the decision until further economic studies are completed.] The proposal is at odds with WCI's own stated principles that include a commitment to cover "as many emissions sources as practical." And for an effort born of frustration with federal lawmakers, it's bizarre that the proposal is significantly smaller in scope than recent federal bills (PDF), including Leiberman-Warner. There are no big technical challenges to including transportation fuels. In fact, the WCI admits that while there are a couple of hurdles, it's administratively feasible to include transportation emissions. So what's going on? No one knows for sure.

How now, organic cow?

As energy, healthcare, and feed costs skyrocket, organic dairy farmers get squeezed

The following is a guest post by Ed Maltby, executive director of the Northeast Organic Dairy Producers Alliance. ----- Deerfield, Mass.: What is more important to Stonyfield Farm and HP Hood, market share or the health and welfare of their organic family farmers? Photo: iStockphoto If you ask 24-year-old Mark Ouellette Jr., who supplies organic milk to HP Hood that is sold under the Stonyfield label, his answer is very clear: market share. "I'm losing up to 60 cents per gallon producing milk for the Stonyfield brand. I've used up my line of credit, I'm close to maxing out my credit card because of spiraling feed and fuel costs." He adds, "Last fall, I and many other organic farmers told both Stonyfield and HP Hood what was happening and we were given a 3 cent per gallon increase. Now another 8 cents starting on April 1. This is a slap in the face." Mark's father was one of the first dairy farmers to sell organic milk in Maine, and Mark started working with him when he was 14, with a dream of working together to expand the family farm. After graduating from high school, Mark realized he needed more experience and equity and started working on the farm, which he purchased two years ago. "I had the opportunity to buy this farm and everyone said there was a tremendous future in organic dairy," says Mark, "so my family and I made the commitment and invested over half a million dollars believing that [Stonyfield CEO] Gary Hirshberg would stand by his pledge to his organic dairy farmers."

Startup company makes thin-film solar cells via new process

Solar company Konarka has announced that it successfully developed a new process to manufacture solar cells that could lead to a range of new solar-powered products and applications. The solar cells are made without silicon and are manufactured into a thin, light film via an inkjet printer, which means they don’t need to be born in a clean room like traditional silicon cells. One drawback to the new cells is their efficiency: while regular silicon solar cells achieve efficiencies of up to 20 percent, the new cells are only 5 percent efficient, but Konarka says they’re likely to be less …